John G. Hirschy & Associates, Inc. “Why do I want to take this Exam?” 1. There will be relatively few that will take the exam, putting you in a better position to be hired. 2. Only those who do well on the exam will be considered for the position. 3. The exam is a two-way screening tool – revealing some of your skills and talents, and providing you with some feeling for what the job will require. ______________________________________________________________________________ The firm is a commercial real estate firm with the following primary operations. Operations Approx. % of Revenue Property Tax Consulting 73% Real Estate Appraisals 23% Brokerage 0% Property Management & Other Sources 4% A significant portion of the property tax consulting work is with residential property. The position is open for a summer intern assisting with the residential accounts for property tax work. During the summer months the firm is composed of the business owner, five to six full-time associates, and three contractors. The summer internship is a full-time temporary position within the firm. The firm is currently 30 years old. The firm is located in Coppell, to the northeast of the DFW Airport, in the Dallas, Texas area. The summer intern position is a full-time (40+ hours per week) position. There will be periods when the workload will most likely require approximately 50 hours per week. The employment period is from May 1, 2015 until the second week of July or so (when the work dwindles to a very low level). The firm completes a substantial amount of property tax consulting business during the months of May, June and July. No vacations will be permitted during these months. The summer intern, as a part of her/his responsibilities, will be screening residential property tax accounts for over-assessment, developing cases for presentations, signing-up new accounts as owners/managers call for property tax help and assisting in all aspects of office work. Additionally, if an associate is licensed, he or she will be negotiating values with Central Appraisal District staff appraisers and making presentations before Appraisal Review Boards. (This is exciting work!!!) ___________________________________________________________________________________ If the above description of the firm and position is attractive to you, please take the following exam. The exam has two parts: Math & Maps; and Ethics, Business Practices, and Computers. The two parts of the exam are not timed, but the exam should take roughly one to two hours to complete. Please type the narrative answers using a computer. Return the exam to [email protected]. You can also mail the exam to P.O. Box 2009, Coppell, TX 75019 or fax it to (972) 304-0811. Please include your resume with the exam. Thank you for your interest in the position. INFORMATIVE EXAM FOR POTENTIAL SUMMER ASSOCIATES & SUMMER INTERNS Date APPLICANT MUST HAVE A GOOD KNOWLEDGE OF MICROSOFT WORD & EXCEL. A GOOD KNOWLEDGE OF MICROSOFT ACCESS IS A SIGNIFICANT PLUS FOR EMPLOYMENT. THERE IS NO REASON TO APPLY FOR THE POSITION UNLESS YOU HAVE AT LEAST AN AVERAGE KNOWLEDGE OF WORD & EXCEL. MATH & MAPS The ability to do basic real estate math and the ability to use maps, architectural and engineering drawings are essential skills for the summer intern position within this firm. A deficiency in any one area will disqualify the applicant for the position. Passing the exam does not qualify the applicant for the position. The exam is one screening tool in seeking a qualified applicant for the position. Passing the first and second parts of the exam qualify the applicant for further consideration. You will need a financial calculator or know financial math for parts of the math portion of the exam. Minimum Passing Grade 1. Basic Real Estate Math 80% 2. Map / Plat Skills 80% I certify that I have not received assistance from anyone nor any reference material (other than a financial calculator) in answering the questions in this exam. I certify that the answers in the following exam are from my personal efforts alone. Signature Please provide your name, home address, and phone numbers in the space below so that we can let you know the results of the exam. Please provide a copy of your resume with the exam. Thank you again, and good luck. Name Street City, State ZIP Phone Number E-mail Address Informative Exam for Potential Associates – Continued Exam Part 1: Math & Maps Page 2 Basic Real Estate Math 1. A lot measuring 130 feet by 200 feet recently sold for $71,500. What was the selling price per square foot? A) $2.75 B) $5.50 C) $275 D) $550 2. A house has a living area of 1,900 square feet. An attached garage has a total area of 420 square feet. The building has an expected life of 50 years and an effective age of five years. The lot is worth $15,000. If it costs $50/SF to reproduce the living area and $25/SF to reproduce the garage on a square foot basis, what is the indicated value of the property? A) $94,950 B) $105,500 C) $109,950 D) $120,500 3. A property sold for $145,000 with $30,000 down and the balance in the form of a purchase-money mortgage (seller financing) at 8 percent for 15 years with monthly payments. Shortly after the sale of the property, the seller sold the mortgage to an investor for $105,000. The price paid by the investor for the mortgage was based on the current market rate for mortgages. What is the cash equivalent selling price for the property? A) $105,000 B) $115,000 C) $145,000 D) $135,000 4. A commercial building leases for $3,000 per month. If the building's dimensions are 60 feet by 80 feet, what is the annual rent per square foot? A) $0.63 B) $1.00 C) $7.50 D) $12.00 Informative Exam for Potential Associates – Continued Exam Part 1: Math & Maps Page 3 Basic Real Estate Math – Continued 5. A two-story office building leases for $16 per square foot per year. The first floor is 80 feet by 100 feet, and the second floor is 80 feet by 80 feet. What is the annual rent for the building? A) $19,200 B) $128,000 C) $230,400 D) $256,000 6. A property has an assessed value of $45,000. If the assessment is 36% of market value, what is the market value? A) $45,000 B) $16,200 C) $125,000 D) None of the above 7. The annual property tax on a parcel of land is $756. The taxing authority assesses land at 60% of its market value. If the tax rate is $1.80 per $100, what is the estimated market value of the land? A) $42,000 B) $58,800 C) $70,000 D) $75,600 8. Which of the following is another word for average? A) Mean B) Median C) Mode D) Standard deviation 9. The mean of five house sales prices of $100,000, $75,000, $175,000, $200,000, and $150,000 is: A) $140,000 B) $150,000 C) $700,000 D) $175,000 Informative Exam for Potential Associates – Continued Exam Part 1: Math & Maps Page 4 Basic Real Estate Math – Continued 10. The median of the house sales prices in question 9 is: A) $140,000 B) $150,000 C) $700,000 D) $175,000 11. The aggregate of the house sales prices in question 9 is: A) $140,000 B) $150,000 C) $700,000 D) $175,000 12. The difference between the highest and the lowest variants is the: A) mean B) mode C) median D) range 13. Ranking the variants from high to low, the center of all variants is the: A) mean B) mode C) median D) range 14. The most frequently occurring variant is the: A) mean B) mode C) median D) range Informative Exam for Potential Associates – Continued Exam Part 1: Math & Maps Page 5 Basic Real Estate Math – Continued The following drawing is for questions 14 through 16. 15. What is the square footage of the garage? A) 96 B) 552 C) 648 D) 46 16. What is the square footage of the covered porch? A) 72 B) 120 C) 192 D) 64 17. What is the square footage of the living area (whole building less garage and covered porch area)? A) 3,107 B) 3,645 C) 3,525 D) 3,659 Informative Exam for Potential Associates – Continued Exam Part 1: Math & Maps Page 6 Basic Real Estate Math – Continued 18. What is the future value of $150 compounded annually at 15% in 15 years? (Round to the nearest dollar.) A) $1,221 B) $488 C) $7,137 D) $23 19. To determine the value in eight years of an investment of $10,000 at 10% interest compounded annually, the applicable factor is: A) 2.143589 B) 2.357948 C) 1.948717 D) 2.182875 20. Calculate the monthly payment required to amortize a loan of $270,000 at 9.5% interest for a term of 40 years. A) $218.72 B) $2,187.17 C) $221.43 D) $2,214 Bonus Question: 21. A property valued at $200,000 produces a net operating income of $24,000 per year. What percentage of value (rate) does this property earn? A) 10% B) 12% C) 15% D) 8% Informative Exam for Potential Associates – Continued Exam Part 1: Math & Maps Page 7 Map / Plat Skills 1. On a map, which direction is typically north? A) Top of map B) Bottom of map C) Left side of map D) Right side of map E) None of the above 2.